As we wrote in the previous articles, UAB Finolita Unio, holder of E- Money Institution license in Lithuania, has been under investigation by Lithuania’s central bank, which has recently revoked the licence of a local FinTech, associated with the Wirecard scandal for major breaches of anti-money-laundering and counter-terrorist financing rules.
Prosecutors in Germany suspect that UAB Finolita Unio, which is registered as an E-Money institution in Lithuania, may have been used to steal more than €100 million from Wirecard just before it collapsed. The Bank of Lithuania reported that UAB Finolita Unio had treated anti-money-laundering and counter-terrorist financing rules (AML in Lithuania) “irresponsibly”, failing to assess the risks of its customers, as well as, negligently checking their identities and beneficial owners.
The UAB Finolita Unio case provoked scrutiny of Lithuania, which, following the Brexit, has the highest number of FinTech’s in the EU. Some politicians in both Lithuania and Germany called UAB Finolita Unio a “wake-up call” for the EU Member State over the need to keep up with the fast-moving FinTech sector and companies holding E-Money Institution license. However, the Lithuanian central bank contacted local payment companies – Electronic Money Institutions in Lithuania and Payment Institutions in Lithuania - in June 2020, right after the German financial regulator acknowledged problems at Wirecard. It began a formal investigation in UAB Finlolita Unio in the autumn of 2020. The Lithuania central bank found that UAB Finolita Unio failed to comply with rules on international sanctions and “inadequately monitored” operations of people related to the company. German prosecutors suspect that part of a €100m loan granted by Wirecard in March 2020 to a subsidiary of UAB Finolita Unio owner, Singapore-based Senjo Group, and processed by it, was channelled to Wirecard’s fugitive Jan Marsalek. UAB Finolita Unio reacted to the revocation of its licence as “extremely severe”, since it had notified the Lithuanian central bank of the suspicious payments and was in the middle of selling itself to new investors, having already transferred voting rights from Senjo to an independent trustee. It added that it would appeal against the decision, which it called “bad news for every participant in the financial market” because companies (Electronic Money Institutions in Lithuania) would try “to hide [their] mistakes rather than try to solve a problem openly”.
Learn more what security risks might affect Electronic Money Institution in Lithuania and how to fill security criteria for restrictions of AML in Lithuania in our previous article here.
Should you be interested in further questions about Electronic Money Institutions in Lithuania and Payment Institutions in Lithuania, you are welcome to contact our Lawyers in Lithuania at firstname.lastname@example.org
Tel.: +371 67240090